March 30th 2004

                         XSTREAM BEVERAGE NETWORK, INC.
                       CODE OF ETHICS AND BUSINESS CONDUCT

                           STATEMENT OF GENERAL POLICY

         This Code of Ethics and Business Conduct (the "Code") has been adopted
to provide guiding principles to the principal executive officer, the principal
financial officer, and the principal accounting officer or controller of XSTREAM
BEVERAGE NETWORK, INC. (the "Company"), in the performance of their duties. It
is strongly recommended, however, that all directors and employees of the
Company comply with the Code in the performance of their duties. The Code should
be read in conjunction with any other policies of the Company that govern the
conduct of such officers.

         The basic principle that governs all of our officers, directors and
employees is that the Company's business should be carried on with loyalty to
the interest of our noteholders, stockholders, customers, suppliers, fellow
employees, strategic partners and other business associates. The philosophy and
operating style of the Company's management are essential to the establishment
of a proper corporate environment for the conduct of the Company's business. In
furtherance of the foregoing, no principal executive officer, principal
financial officer, or principal accounting officer or controller, or persons
performing similar functions shall: (a) employ any device, scheme or artifice to
defraud the Company or any Business Associate (as defined below); or (b) engage
in any act, practice or course of conduct that operates or would operate as a
fraud or deceit upon the Company or any Business Associate.

         The Company is committed to a high standard of business conduct. This
means conducting business in accordance with the spirit and letter of applicable
laws and regulations and in accordance with ethical business practices. This
Code, which applies to all Insiders (as defined below) and their Family Members
(as defined below), is intended to help in this endeavor by providing a
statement of the fundamental principles that govern the conduct of the Company's
business. In addition, all Insiders and their Family Members are responsible for
complying with all applicable laws and regulations.

Definition of Terms Used
------------------------

         "Business Associate" means any supplier of services or materials,
customer, consultant, professional advisor, lessor of space or goods, tenant,
licensor, licensee or partner of the Company.

         "Company" includes XSTREAM BEVERAGE NETWORK, INC. and each of its
subsidiaries.

         "Insider" means the principal executive officer, principal financial
officer, and principal accounting officer or controller of the Company, or
persons performing similar functions.

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         "Family Members" means as to a specific Insider, his or her Immediate
Family Members and any company, partnership, limited liability company, trust or
other entity that is directly or indirectly controlled by that Insider or by any
Immediate Family Member of that Insider.

         "Immediate Family Member" includes the spouse (or life partner) and
children of an Insider and any relative (by blood or marriage) of that Insider
or spouse (or life partner) residing in the same household as such Insider.

         "Compliance Officer" shall mean Ted Farnsworth.

Transactions with the Business Associates
-----------------------------------------

         In adhering to the foregoing basic principles, none of our Insiders or
their Family Members must profit, directly or indirectly, due to position in, or
relationship to an Insider having a position in, the Company to the detriment,
or at the expense, of the Company or any Business Associate. No Insider shall
take for his or her own advantage any corporate opportunity for profit, which he
or she learns about in his or her position with the Company.

         Insiders and their Family Members are encouraged to patronize our
Business Associates. However, no Insider or Family Member shall sell to, or
purchase from, a Business Associate any goods or services except in the ordinary
course of the Business Associate's business. No Insider or Family Member shall
borrow money or other property from a person known by the Insider to be a
Business Associate, unless that Business Associate is regularly engaged in the
business of lending money or such other property, and the loan and the terms
thereof are in the ordinary course of the Business Associate's business.

         No Insider shall, directly or indirectly, make any payment or take any
action with respect to any government official, agent or representative of the
United States, any State or jurisdiction of the United States or of any foreign
country without the prior consent of the Compliance Officer. No Insider shall
make any payment or take any action in violation of the U.S. Foreign Corrupt
Practices Act.

Non-Disclosure of Information
-----------------------------

         No Insider or Family Member shall discuss with, or inform others about,
any actual or contemplated business transaction by a Business Associate or the
Company except in the performance of the Insider's employment duties or in an
official capacity and then only for the benefit of the Business Associate or the
Company, as appropriate, and in no event for personal gain or for the benefit of
any other third party.

         No Insider or Family Member shall give any information to any third
party about any business transaction of the Company or its Business Associates
that are proposed or in process unless expressly authorized to do so by the
Board of Directors of the Company or the Compliance Officer.

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Preferential Treatment and Gifts
--------------------------------

         No Insider shall seek or accept for his or her self or for any Family
Member any favors, preferential treatment, special benefits, special documents,
gifts or other consideration as a result of such Insider's association with a
Business Associate or the Company, except those usual and normal benefits
directly provided by a Business Associate or the Company. The foregoing,
however, does not prohibit receipt of gifts of nominal value.

Conflicts of Interest
---------------------

         An Insider shall maintain a high degree of integrity in the conduct of
the Company's business and shall maintain independent judgment. Each Insider
must avoid any activity or personal interest that creates, or appears to create,
a conflict between his or her interests and the interests of the Company. A
conflict of interest arises any time such a person has a duty or interest that
may conflict, directly or indirectly, with the proper and impartial fulfillment
of such person's duties, responsibilities or obligations to the Company.
Conflicts of interest include, by way of example, a person:

                  -- making an investment that may affect his or her business
         decisions on behalf of the Company;

                  -- owning a meaningful financial interest in, or being
         employed by, an organization that competes with the Company;

                  -- owning a meaningful financial interest in, or being
         employed by, an organization that does, or seeks to do, business with
         the Company;

                  -- making a material decision on a matter on behalf of the
         Company where such person's self-interests may reasonably call the
         appropriateness of the decision into question;

                  -- being employed by or accepting compensation from any other
         person or

entity as a result of business activity or prospective business activity
affecting the Company.

         An officer or employee who becomes aware of any Insider's personal
interest (including one's own) that is, or may be viewed as, in conflict with
that of the Company or a Business Associate should promptly present the
situation and the nature of the possible conflict to the Compliance Officer or,
if timely disclosure to the Compliance Officer is impracticable, to the Board of
Directors for appropriate consideration. A director of the Company that becomes
aware of any Insider's conflict of interest should bring the matter to the
attention of the Audit Committee or, if timely disclosure to the Audit Committee
is impracticable, the Board of Directors of the Company. The Insider shall
refrain from further action until the situation has been consented to in writing
by the Compliance Officer, the Audit Committee, or Board of Directors, as the
case may be.

         No Insider or Family Member shall personally benefit, directly or
indirectly, from any Company purchase or sale, or derive any other personal gain
from any other Company activity, except when the transaction has been fully
disclosed to and approved in writing by the Audit Committee.

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         No Insider or Family Member shall have any meaningful personal business
or financial interest in any Business Associate or competitor of the Company,
without proper consent in writing by the Audit Committee. For these purposes,
holding 5% or less of the outstanding equity interests of a Business Associate
or competitor whose equity interests are publicly traded shall not be deemed
"meaningful."

         No Insider shall hold any position with (including as a member of the
board of directors or other governing body) or perform services for a Business
Associate or a competitor of the Company, without proper consent in writing by
the Audit Committee.

         No Insider shall provide any services to other business enterprises
which reasonably could be deemed to adversely affect the proper performance of
his or her work for the Company or which might jeopardize the interests of the
Company, including serving as a director, officer, consultant or advisor of
another business, without prior consent in writing by the Audit Committee under
this Code.

         No Insider shall direct, or seek to direct, any Company business with
any business enterprise in which the Insider or his or her Family Member has a
meaningful ownership position or serves in a leadership capacity, without proper
consent in writing by the Audit Committee under this Code.

Personal Securities Transactions
--------------------------------

         No Insider shall knowingly take advantage of a corporate opportunity
for personal benefit or take action inconsistent with such Insider's obligations
to the Company's Business Associates in his capacity as a Company
representative.

Guarding Corporate Assets
-------------------------

         Insiders have a duty to safeguard Company assets, including its
physical premises and equipment, records, customer information and Company
trademarks, trade secrets and other intellectual property. Company assets shall
be used for Company business only. Without specific authorization, no Insider or
Family Member may take, loan, sell, damage or dispose of Company property or
use, or allow others to use, Company property for any non-Company purposes.

Corporate Books and Records
---------------------------

         Insiders must ensure that all Company documents are completed
accurately, truthfully, in a timely manner and properly authorized. Financial
activities and transactions must be recorded in compliance with all applicable
laws and accounting practices and in accordance with the generally accepted
accounting principles designated by the Company. The making of false or
misleading entries, records or documentation is strictly prohibited. Insiders
may never create a false or misleading report under the Company's name. In
addition, no payments or established accounts shall be used for any purpose
other than as described by their supporting documentation. No undisclosed

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funds or assets may be established.

         No Insider may take any action to defraud, influence, coerce,
manipulate or mislead any other Insider or any outside auditor or lawyer for the
Company for the purpose of rendering the books, records or financial statements
of the Company incorrect or misleading.

         Errors, or possible errors or misstatements in the Company's books and
records must be brought to the attention of the Compliance Officer promptly or,
if timely disclosure to the compliance officer is practicable, to the Audit
Committee upon discovery thereof. The Compliance Officer shall promptly inform
the Audit Committee of any such error or misstatement. All employees and
officers are expected to cooperate fully with the Company's internal auditors
and outside auditors. No employee or officer shall impede or interfere with the
financial statement audit process.

Compliance with Law

         All Insiders shall comply with applicable governmental laws, rules and
regulations. Any Insider who becomes aware of a potential breach by another
Insider of such laws, rules or regulations shall bring the matter to the
attention of the Board of Directors of the Company immediately.

Document Retention
------------------

         The Company seeks to comply fully with all laws and regulations
relating to the retention and preservation of records. All Insiders shall comply
fully with the Company's policies regarding the retention and preservation of
records. Under no circumstances may Company records be destroyed selectively or
maintained outside Company premises or designated storage facilities.

         If the existence of a subpoena or impending government investigation
becomes known to an Insider, he or she must immediately contact the Compliance
Officer. Insiders must retain all records and documents that may be responsive
to a subpoena or pertain to an investigation. Any questions regarding whether a
record or document pertains to an investigation or may be responsive to a
subpoena should be resolved by the Compliance Officer before the record or
document is disposed of. Insiders shall strictly adhere to the directions of the
Compliance Officer in handling such records or documents.

Compliance with Internal Controls and Disclosure Controls
---------------------------------------------------------

         The Company has adopted a system of internal controls that must be
strictly adhered to by all Insiders in providing financial and business
transaction information to and within the Company. The internal controls are the
backbone of the integrity of the Company's financial records and financial
statements.

         Each Insider shall promptly report to the Compliance Officer any actual
or suspected

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breaches or violations of the Company's internal controls that come to the
attention of the Insider. The Compliance Officer shall promptly bring the matter
to the attention of the Disclosure Committee.

         Each Insider shall promptly report to the Compliance Officer any
fraudulent or questionable transactions or occurrences, whether actual or
suspected, that come to the attention of the Insider. Potentially fraudulent or
questionable transactions or occurrences include, without limitation,
embezzlement, forgery or alteration of checks and other documents, theft,
misappropriation or conversion to personal use of Company assets, falsification
of records, and the reporting of the financial condition of the Company contrary
to generally accepted accounting principles. The Compliance Officer shall
promptly bring the matter to the attention of the Disclosure Committee.

         Each Insider is encouraged to bring to the attention of the Disclosure
Committee or any Disclosure Officer, as provided under the Company's Disclosure
Controls and Procedures Policy, any changes that the Insider believes may
improve the Company's system of internal controls.

         The Company has adopted a system of disclosure controls and procedures
pursuant to its Disclosure Controls and Procedures Policy to assure that all
important information regarding the business and prospects of the Company is
brought to the attention of the Chief Executive Officer and Chief Financial
Officer of the Company. The accuracy and timeliness of compliance is critical to
this system of disclosure controls and necessary to enable those officers to
provide the financial statement and periodic report certifications required by
federal law.

         Each Insider shall strictly adhere to the system of disclosure controls
and procedures of the Company as set forth in the Company's Disclosure Controls
and Procedures Policy.

         Each Insider shall promptly report in accordance with the Company's
Disclosure Controls and Procedures Policy any significant event or occurrence
(whether positive or negative) that arises in the course of the Insider's duties
and responsibilities. Events or occurrences include those that affect or may
affect the Company or its Business Associates, competitors or industry. General
economic conditions need not be reported.

         Each Insider shall be candid in discussing matters concerning internal
controls and business disclosures with the Company's management, internal
auditors, outside auditors, outside counsel and directors. Factual information
is important. Opinions and observations are strongly encouraged.

Implementation of the Code
--------------------------

         While each Insider is individually responsible for compliance with the
Code, he or she does not do so in a vacuum. The Company has the following
resources, people and processes in place to answer questions and guide Insiders
through difficult decisions.

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                  (a) Compliance Officer Responsibility. Barry Willson has been
         designated the "Compliance Officer" and shall report directly to the
         Company's Disclosure Committee, as created pursuant to the Company's
         Disclosure Controls and Procedures Policy, the Audit Committee and the
         Board of Directors, as may be determined to be appropriate. The
         Compliance Officer is responsible for overseeing, interpreting and
         monitoring compliance with the Code. The Compliance Officer shall
         report periodically to the Company's Disclosure Committee and Audit
         Committee regarding all aspects of administering and enforcing of the
         Code.

                  (b) Reporting Violations. If an Insider knows of or suspects a
         violation of applicable law or regulations, this Code or any of the
         Company's other policies, he or she must immediately report that
         information to the Compliance Officer, the Disclosure Committee, or the
         Audit Committee of the Board of Directors of the Company. No Insider
         who reports an actual or suspected violation in good faith will be
         subject to any retaliation whatsoever.

                  (c) Investigations of Violations. Reported violations will be
         promptly investigated and treated confidentially to the extent
         possible. It is imperative that the person reporting the violation not
         conduct a preliminary investigation of his or her own. Investigations
         of alleged violations may involve complex legal issues. Persons who act
         on their own may compromise the integrity of an investigation and
         adversely affect both themselves and the Company.

Enforcement
-----------

         The Compliance Officer will take such action he or she deems
appropriate with respect to any Insider who violates, or whose Family Member
violates, any provision of this Code, and will inform the Audit Committee of all
material violations. Any alleged violation by the Compliance Officer will be
presented promptly to the Audit Committee for its consideration and such action
as the Audit Committee, in its sole judgment, shall deem warranted.

         The Compliance Officer will keep records of all reports created under
this Code and of all action taken under this Code. All such records will be
maintained in such manner and for such periods as are required under applicable
federal and state law, as well as the Company's document retention policy.

Condition of Employment or Service
----------------------------------

         All Insiders shall conduct themselves at all times in the best
interests of the Company. Compliance with this Code shall be a condition of
employment and of continued employment with the Company, and conduct not in
accordance with this Code shall constitute grounds for disciplinary action,
including, without limitation, termination of employment.

         This Code is not an employment contract nor is it intended to be an all
inclusive policy statement on the part of the Company. The Board of Directors
Company reserves the right to provide the final interpretation of the policies
it contains and to revise those policies as deemed necessary or appropriate.

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                                   **********

         I acknowledge that I have read this Code of Ethics and Business Conduct
(a copy of which has been supplied to me and which I will retain for future
reference) and agree to comply in all respects with the terms and provisions
hereof. I also acknowledge that this Code of Ethics and Business Conduct may be
modified or supplemented from time to time, and I agree to comply with those
modifications and supplements, as well.

Date:    March 30, 2004                     By:   /s/ Ted Farnsworth
                                                  ---------------------
                                            Name: Ted Farnsworth


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